Why I exposed missing oil revenue — Sanusi

06 February 2014, LAGOS — The Governor of the Central Bank of Nigeria, CBN, Mallam Lamido Sanusi, yesterday, explained that he exposed the opaque management of oil revenue in the country so that it could lead to people being asked to explain what they had done with the money. He also said that he “loves controversy”.

According to the CBN Governor, the controversy surrounding the missing oil revenue was also good for the country.

Sanusi spoke Tuesday night, while addressing the Standard Bank’s West Africa Investors Conference.
His words: “A lot of the noise that is happening in the country today around me and the oil sector is good for the country because at the end of the day, if it leads to improved governance of oil revenue; if it leads to increased transparency or people having to be called to explain what they have done with the money- that is good for the system.

“People must not see controversy and noise as necessarily bad. I love controversy. If you think there has to be change and if you think a system needs to be improved; and if you get too comfortable in a system, you should ask yourself what has happened to you. You need to step on a few toes, annoy a few people, have your own toes stepped on. You will be annoyed once in a while, of course they will slap you once in a while.”

Sanusi however, assured the gathering of the commitment of the CBN to the stability of the exchange rate, saying the apex bank would continue to defend the Naira as long as there was stable crude oil prices.

“We have tried to build a stable environment and for us at the CBN, we have been very lucky to have had a very good partner in the finance ministry. If you look at government spending in 2013, it really wasn’t much higher in 2012 and fiscal policy is not in itself loose on the basis of government spending.

“The real challenge is that there are things that we can do to block some of the revenue shortfalls that are causing the problem — oil theft and bunkering because we have good oil price; we have got the output and if you fix that, the issue of reserves; currency stability, fiscal deficit would simply disappear. But government spending itself has not been the problem. It is largely because of the fiscal discipline in the last few years that our tight monetary policy has been able to work.

“We have been able to bring down inflation to single digit and it has been below 10 per cent since January 2012. It would remain below 10 per cent throughout 2014. I know there is speculation about how much money will come into the economy during elections, but how much money is there anyway? It’s $2.5 billion in the Excess Crude Account. So even if people want to spend money, the money won’t be available. So the risk from that end is not as high as people might think.

“The greater risk is if we continue to have deterioration in the revenue profile and that can be addressed because it is really a factor within our control. So we have low inflation and the CBN has a stable exchange rate as the cornerstone of its price stability policy and that has been communicated very clearly to the market.

“We have always had our eyes on stability. We are willing to tighten money; we are willing to use reserves within reasonable limits to give you the investors, an anchor for your expectations.

“We don’t want people to come to the market worrying about whether the Naira is going to be on a free fall. Now we do not guarantee that if oil prices fall, there will be no exchange rate movement. But so long as we have stable oil prices, stable output, stable macro conditions, we are committed to exchange rate stability and we will support the currency and that stability is what I think will continue in the future,” he said.

Reactions trail allegation
Meanwhile, reactions have continued to trail the allegation by the CBN governor that the Nigerian National Petroleum Corporation, NNPC, has failed to remit $20 billion into the coffers of the Federal Government, in a public hearing at the Senate, Tuesday.

Minority Leader of the House of Representatives, Femi Gbajabiamila, in his reaction told Vanguard that it’s a shame that such a huge amount could not be accounted for. “It simply brings home the position our caucus took at the budget debate, yesterday, (Tuesday). The reason such colossal sums can disappear is because of the non-compliance with Section 21 of the Fiscal Responsibility Act and refusal of the Minister of Finance to submit the detailed estimates of agencies such as NNPC to the National Assembly as prescribed by law. It is a crying shame and an indictment on the NASS that it has taken the Governor of CBN to discover what we should have, had we properly discharged our oversight functions by insisting on compliance with the Fiscal Responsibility Act,” he said.

In the same vein, Rep Pally Iriase (APC, Edo State), said Nigerians should show concern on the issues of accountability in government agencies.

“Nigerians should be concerned about the lack of accountability by NNPC and even other revenue agencies. The latest revelation vindicates the House of Representatives’ insistence that the current budget must comply fully with the Fiscal Responsibility Act”.

On his part, Rep Abiodun Faleke (PDP, Lagos) said CBN would be invited to give further explanations on the unremitted fund. “It is shocking. We will write him to request for the details for our investigation,” he said.

Chairman, House committee on e-Parliament, Rep Razaq Bello-Osagie said: “This ugly development is unfortunate and a show of shame. Nigeria is now a laughing stock in the comity of nations. This has vindicated our position at the National Assembly for insisting that the 2014 budget estimates forwarded to the National Assembly by the Executive must be accompanied by details of budget estimates of Agencies and corporations under the Federal Government.”

Senator Olubunmi Adetunmbi, Ekiti State, called for vigilance so that the allegation is not swept under the carpet, noting that issues of public finance, transparency and accountability should be taken seriously.

Adetumbi who is the Vice Chairman, Senate Committee on Interior, said: “It is only when all unremitted funds are accounted for that Nigerians will be assured that they have not been short-changed. The time has come for all Nigerians to show more interest and pay serious attention to issues of public finance, transparency and accountability. I have been watching with keen interest the ongoing investigations on the alleged unremitted $49.9bn funds, now reviewed downwards to $20bn by the CBN Governor from oil exports into the Federation Account.

Also reacting in a telephone interview with Vanguard, former Governor of Ekiti State, Otunba Niyi Adebayo, said: “No matter the figure Sanusi mentioned, it is obvious that money is missing. Whether it is $10 billion, $12 billion or $20 billion, it is obvious that money is missing and it should be investigated.”

Senator Emma Anosike from Anambra State, however, flayed the CBN governor, accusing him of playing to the gallery. “I feel so disappointed in the sense that the Central Bank Governor should stop playing to the gallery. The last time he spoke to this country, he came out, first of all made an allegation and the second time, he came and apologized that he had reconciled with them. This time around, he has said that $20 billion is missing. Who do we believe? How do we have confidence in this kind of person?”

Sanusi, however, found strong support from the Conference of Nigerian Political Parties, CNPP saying the body entirely agreed with Sanusi. Mr. Okechukwu told Vanguard that, “one entirely agrees with the Governor of the CBN that money is missing from revenue accruing to Nigeria between January 2012 to July 2013; the only missing link is the exact amount, but the truth remains that some money was stolen.